BOARD MEETING DATE: February 6, 2009
AGENDA NO. 5

PROPOSAL:

Adopt Resolution Accepting Terms and Conditions for FY 2008-09 Carl Moyer Program Award and Recognizing Funds, Issue Carl Moyer Program Announcement for FY 2008-09 and Amend Award under Carl Moyer Program

SYNOPSIS:

These actions are to adopt a resolution recognizing $34,387,858 in Carl Moyer Program grant awards from CARB under SB 1107 with its terms and conditions for FY 2008-09 and to approve the release of a Program Announcement to provide incentive funding for low-emission on- and off-road vehicles and equipment for the FY 2008-09 “Year 11” Carl Moyer Program. Total available funds for the program announcement will be approximately $15 million from the Carl Moyer Program Fund SB 1107 and AB 923 accounts. The final action is to amend an award under the Carl Moyer Program.

COMMITTEE:

Technology, January 23, 2009, Recommended for Approval

RECOMMENDED ACTIONS:

1. Approve the attached resolution to recognize up to $34,387,858 from CARB, place these funds in the Carl Moyer Program Fund SB 1107 and accept the terms and conditions of the FY 2008-09 Carl Moyer Grant award.
2. Approve issuance of Program Announcement PA #2009-06 to solicit projects for the FY 2008-09 “Year 11” Carl Moyer Memorial Air Quality Standards Attainment Program.
3. Amend an award to GATX, originally approved on October 3, 2008, for the purchase of one low-emitting switcher locomotive from $558,367 to $1,043,231 from the Carl Moyer Program Fund, SB 1107 Account, due to a change of calculation methodology in consultation with CARB.
    

Barry R. Wallerstein, D.Env.
Executive Officer

Background

The Carl Moyer Memorial Air Quality Standards Attainment Program (CMP) provides funds on an incentive basis for the incremental cost of purchasing cleaner than required engines and equipment. Eligible projects include cleaner on- and off-road, marine, locomotive, and agricultural engines, as well as forklifts, airport ground support equipment, and auxiliary power units.

This is the eleventh year of the CMP and the fifth year of the program with funding from SB 1107 and AB 923. CARB has allocated $34,387,858 to the AQMD under SB 1107 for implementation of the FY 2008-09 CMP. Of this amount, $1,719,393 is designated for administrative and outreach efforts and $32,668,465 for projects funding. In addition, $5,306,768 is required from the AQMD as its local match funding.
 

Proposal

Staff recommends that the Board recognize and approve the terms and conditions for receiving $34,387,858 from CARB as AQMD’s 2008-09 “Year 11” Carl Moyer Program allocation under SB 1107. For “Year 11” of the CMP, staff is requesting approval to release Program Announcement PA #2009-06, for approximately $15 million from the Carl Moyer Program Fund SB 1107 and AB 923 accounts. Both this program announcement and the one under the SOON Provision (PA #2009-03) issued on November 7, 2008, will close on May 1, 2009. The evaluations and awards for these programs will be done concurrently and depending on the funding amounts for eligible projects a detailed account of available funds from the Carl Moyer Program Fund, including earned interest and the split between the SB 1107 and the AB 923 accounts for the “Year 11” projects funding, will be outlined at the time of awards recommendations.

If more funds become available by the time of awards approval, more projects will be awarded up to the total amount of funds available. All the proposed projects will be evaluated according to the CMP guidelines released by CARB in April 2008. The CMP guidelines require that the emission reductions be a minimum of 15 percent for repower or retrofit projects and 30 percent for new engines. Staff proposes more stringent criteria for cost-effectiveness of forklift projects based on experience derived from past solicitations. Table 1 outlines the proposed minimum funding allocations and the maximum allowed cost-effectiveness requirements for each category and subcategory:

Table 1
Proposed Funding and Cost-Effectiveness Limits

*In case of oversubscription in these categories, greater funding may be recommended.
 

The proposed program announcement will solicit projects for on- and off-road vehicles and equipment, including refuse haulers, on-road trucks, transit buses, locomotives, marine and port applications, and other vehicles and equipment. As in previous years, AQMD will fund diesel to diesel applications only when alternative fuel engines/vehicles are not commercially available or certified by CARB. A goal of at least 40 percent is set for funding projects related to goods movement. The projects would need to meet the cost-effectiveness and all the other requirements of the program.

Proposals for all categories will be due by 1:00 pm on Friday, May 1, 2009. Staff expects to finalize the review and evaluation of the proposals and recommend awards for Board approval in the September and October 2009 Governing Board meetings, contingent upon receiving the required funds from CARB. The Carl Moyer Program Announcement is included as Attachment 2.

Staff also recommends that the Board approve the amendment of an award to GATX from the list of backup projects originally approved on October 3, 2008 for the purchase of one switcher locomotive from $558,367 to $1,043,231 from the Carl Moyer Program Fund, SB 1107 Account. The proposed increase to the GATX award is a result of several direct discussions between staff and ARB.  This locomotive is currently undergoing verification by the US EPA for final certification and received a provisional verification from ARB to proceed.  During subsequent review of this project, several issues regarding the Moyer Guidelines were brought to light that resulted in modifications to ARB’s calculation methodology for locomotives.  These clarifications of the Moyer Guidelines will soon be issued as a formal Advisory that will be on the ARB website.  In the interim, ARB staff has re-evaluated the GATX project based on the modified criteria and given a case-by-case approval to the GATX project.  The modifications allow for the award to fund 85% of the actual project costs, where the prior percentage allowed was 50%, which primarily accounts for the increased funding award request.

Program Guidelines

At its July 8, 2005 meeting, the Board approved a long-term Program Guideline for the implementation of the Carl Moyer Program in the South Coast Air Basin with continuous funding from SB 1107 and AB 923 until 2015. The proposed funding distribution for different equipment categories is made in this Board letter according to the criteria outlined in that Guideline with emphasis on the following priorities in order to achieve the highest emission reductions:

• Goods Movement (40 percent allocation)
• Environmental Justice (50 percent allocation)
• Cost Effectiveness
• Low Emission Engine / Vehicle Preference
• Early Commercialization of Advanced Technologies/Fuels
• Fleet Rules
• School Buses

Funding Distribution

As required by AB 1390, the CMP guidelines include the requirement that at least 50% of the program funds must be spent in disproportionately impacted areas. At least half the funding allocated under SB 1107 and collected under AB 923 will be awarded to projects located in disproportionately impacted areas. It has been the policy of the AQMD to allocate at least 50% of all funding available in the CMP, including roll-over funding from previous years and turnback funds, to disproportionately impacted areas.
 

Disproportionately Impacted Areas Point Ranking

The requirements of the CMP will be implemented according to the following criteria.

1. All projects must qualify for the Carl Moyer program by meeting the cost effectiveness limits established in the program announcement.
2. All projects will be evaluated according to the following criteria to qualify for funding as a disproportionately impacted area:
   1. Poverty Level: All projects in areas where at least 10 percent of the population falls below the Federal poverty level based on the year 2000 census data are eligible to be included in this category, and
   2. PM Exposure: All projects in areas with the highest 15 percent of PM concentration will be eligible to be ranked in this category. The highest 15 percent of PM concentration is 46 micrograms per cubic meter and above, on an annual average, or
   3. Air Toxics Exposure: All projects in areas with a cancer risk of 1,000 in a million and above (based on Mates II estimates) will be eligible to be ranked in this category.

The maximum score will be comprised of 40 percent for poverty level and 30 percent each for PM and toxic exposures. Special circumstances exist in some areas, such as the Ports of Long Beach and Los Angeles. Since there are no residents within the ports, poverty ranking could not be established. In this case, the poverty ranking from the adjacent on-shore areas were extended to the port since these populated areas are directly impacted by port activities.

Outreach

In accordance with AQMD’s Procurement Policy and Procedure, a public notice advertising the RFP/RFQ and inviting bids will be published in the Los Angeles Times, the Orange County Register, the San Bernardino Sun, and Riverside County Press Enterprise newspapers to leverage the most cost-effective method of outreach to the entire South Coast Basin.

Additionally, potential bidders may be notified utilizing the Los Angeles County MTA Directory of Certified Firms, the Inland Area Opportunity Pages Ethnic/Women Business & Professional Directory; and AQMD’s own electronic listing of certified minority vendors. Notice of the RFP/RFQ will be mailed to the Black and Latino Legislative Caucuses and various minority chambers of commerce and business associations, and placed on the Internet at AQMD’s Web site (http://www.aqmd.gov where it can be viewed by making menu selections “Inside AQMD”/“Employment and Business Opportunities”/“Business Opportunities” or by going directly to http://www.aqmd.gov/rfp/index.html). Information is also available on AQMD’s bidder’s 24-hour telephone message line (909) 396-2724.
 

Benefits to AQMD

The AQMD has supported a number of activities directed to advancement of new technologies and commercialization of low-emission alternative fuel technologies. The successful implementation of the Carl Moyer Program is a direct result of these Technology Advancement activities. The vehicles and equipment funded under this program announcement will operate many years, providing long-term emissions reductions.
 

Resource Impacts

Total amount of available funds for the Carl Moyer Program under Program Announcement PA #2009-06 is approximately $15 million from the Carl Moyer Program SB 1107 and AB 923 accounts.

Total amount of funding increase for the amendment of a locomotive project award shall not exceed $484,864 from the Carl Moyer Program Fund, SB 1107 Account.
 

Attachments (DOC, 2M)

1. A Resolution of the South Coast Air Quality Management District Board Recognizing and Accepting the Terms and Conditions of the 2008-09 Carl Moyer Grant Award
2. Program Announcement PA #2009-06
    

RESOLUTION NO. 09-

A Resolution of the South Coast Air Quality Management District Board Recognizing and Accepting the Terms and Conditions of the

FY 2008-09 Carl Moyer Grant Award

 WHEREAS, under Health & Safety Code §40400 et seq. the South Coast Air Quality Management District (AQMD) is the local agency with the primary responsibility for the development, implementation, monitoring and enforcement of air pollution control strategies, clean fuels programs and motor vehicle use reduction measures; and

 WHEREAS, the AQMD is authorized by Health & Safety Code §§40402, 40440, and 40448.5 to implement programs to reduce transportation emissions, including programs to encourage the use of alternative fuels and low-emission vehicles; to develop and implement other strategies and measures to reduce air contaminants and achieve the state and federal air quality standards; and

 WHEREAS, the Board has adopted several programs to reduce emissions from on-road and off-road vehicles, as well as emissions from other equipment, including the School Bus Incentive Program and the Carl Moyer Program; and

 WHEREAS, the South Coast Air Quality Management District is designated as an extreme non-attainment area for state ozone standards and has requested classification as extreme for federal ozone standards, and as such is required to utilize all feasible means to meet national ambient air quality standards.

 THEREFORE, BE IT RESOLVED that the Board of the South Coast Air Quality Management District, State of California, in regular session assembled on February 6, 2009, does hereby accept the terms and conditions of the 2008-09 (year 11) Carl Moyer Program grant award and recognizes up to $34,387,858 in SB 1107 funds.

 BE IT FURTHER RESOLVED that the Executive Officer is authorized and directed to take all steps necessary to carry out this Resolution.
 

________________________                     __________________________
        Date                                          Clerk of the Board